APPLE WARNS OF 'MATERIAL' RISK FROM BRUSSELS OVER IRISH TAX INVESTIGATION - Apple has warned investors that it could face “material” financial penalties from the European Commission’s investigation into its tax deals with Ireland - the first time it has disclosed the potential consequences of the probe.
Under US securities rules, a material event is usually defined as 5% of a company’s average pre-tax earnings for the past three years. For Apple, which reported the highest quarterly profit ever for a US company in January, that could exceed $2.5 billion, according to Financial Times calculations. The warning came in Apple’s regular 10-Q filing to the Securities and Exchange Commission on Tuesday, a day after it reported first-quarter revenues of $58 billion and net income of $13.6 billion. Brussels has the power to order Dublin to reclaim 10 years of tax advantages granted to Apple if it finds that deals struck in 1991 and 2007 were unlawful. Both the Irish government and Apple have consistently denied any wrongdoing and declined to comment on the size of any fine. However, some Brussels officials suggest any ruling could set a new record for a state-aid investigation penalty by comfortably topping €1 billion. Apple said in the filing: “If the European Commission were to conclude against Ireland, it could require Ireland to recover from the company past taxes covering a period of up to 10 years reflective of the disallowed state aid, and such amount could be material.”
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DUFFY'S LOANBOX SET TO SEAL €350 MILLION IN BACKING - Veteran banker Mark Duffy, who once headed Bank of Scotland's Irish arm, is close to finalising as much as €350m in funding from US and European investors for a new major commercial lending venture in Ireland, the Irish Independent has learned. Mr Duffy and a band of former bankers, including people who also worked for Bank of Scotland here, plan to use the funds to facilitate up to €1 billion in commercial lending to the Irish market over the next three years, it is believed. The plan is to challenge the pillar banks including Bank of Ireland and Allied Irish Banks. The new venture is called LoanBox, and will use the funds to offer finance alternatives in Ireland, both north and south. It is a subsidiary of Dublin-based company European Asset Resolution Partners (EARP), which was founded by Mr Duffy about 18 months ago. Mr Duffy is chief executive of EARP, which has so far been largely active in Spain and Portugal. It buys non-performing loans, typically from banks, and works with borrowers on a consensual basis to work out those loans. It also offers an opportunity to buy the loans back.
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DUBLIN PROPERTY INVESTOR CLOSES €95 MILLION DEAL IN GERMANY - Greenman Investments, a Dublin-headquartered firm that specialises in buying German retail assets, has paid €95 million for a portfolio of 29 stores from Edeka, Germany’s largest grocer, which has 26% of the German market. John Wilkinson, the managing director of Greenman, said the sale and leaseback deal brings the total value of German retail assets under Greenman’s control to €270 million. Greenman is in “acquisition mode” and is planning to almost double its holding of German retail assets to €500 million by “this time next year”, Mr Wilkinson said. Greenman is currently in talks with Edeka, which has 11,000 stores and sales of about €50 billion, to buy a further portfolio of stores in a sale and leaseback that it expects to complete by the end of October, writes the Irish Times. The Edeka acquisition was completed using a vehicle Greenman has set up in partnership with German commercial property company WCM. The German company has an option to purchase a majority of the joint venture.
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€75m MAJORITY STAKE IN DOCKLANDS OFFICE FOR SALE - Demand for high-quality office accommodation in the sought-after Dublin Docklands shows little sign of abating as one of the final office buildings in the vicinity hits the market with a €75m price tag, says the Irish Examiner. A 70.8% stake in the ‘Riverside 1’ office building beside The Ferryman pub on Sir John Rogerson’s Quay was yesterday brought to market by Savills. The building is let in its entirety to McCann FitzGerald, one of Ireland’s leading law firms, and currently accommodates 450 staff while Aviva is retaining its 29.2% stake in the development. "An opportunity to acquire one of Dublin’s most recognised office buildings is extremely rare; therefore we expect demand from a wide variety of investor types either seeking to expand an already established property platform in Ireland or alternatively those seeking to enter the market for the first time," the Savills agents handling the sale said yesterday. The seven-floor grade A building was constructed by John Sisk and Son on behalf of the partners of McCann Fitzgerald and designed by Scott Tallon Walker Architects and construction was completed in 2006.
